Advertising giant WPP says sales to rebound to pre-pandemic levels by 2022
Advertising giant WPP has said it expects sales to return to pre-pandemic levels by 2022, a year earlier than previously forecast.
Shares in the FTSE 100 firm lifted higher after it said it expects its recovery to be accelerated by its shift towards e-commerce and digital services.
The owner of the Ogilvy and Grey agencies said it will continue to drive growth by securing annual cost savings of £600 million by 2025 and reinvesting this in talent, incentives and technology.
It said it also plans to drive growth through mergers and acquisitions, with between £200 million and £400 million expected to spent on acquisitional growth each year.
WPP told investors that its like-for-like revenues were down 6.7% for the two months to November, after improvement since the pandemic first struck and resulted in cuts to marketing budgets among major clients.
Like-for-like revenue for the year to date has fallen by roughly 8.4%, the group said.
Meanwhile, like-for-like revenues are expected to deliver mid-single-digit growth in 2021.
WPP added that it will reinstate its share buyback programme in 2021 and pay a progressive dividend for the year.
Mark Read, chief executive officer of WPP, said: “It has been two years since we set out our strategy to return WPP to growth.
“Since then, we have made significant progress, with stronger agency brands, new leadership, a simpler structure and a strong balance sheet.
“We can see the results in our industry-leading new business performance, with 5.6 billion dollars (£4.1 billion) won in the first nine months including Alibaba, HSBC, Intel, Uber and Unilever.”
Shares in the company were 4.2% higher at 815p in early trading.